CEL-SCI Announces Adoption of Shareholder Rights Plan
VIENNA, Va., Nov. 9 /PRNewswire-FirstCall/ -- CEL-SCI Corporation announced today that its Board of Directors has approved a Stockholder Rights Plan designed to ensure that all of its stockholders receive fair and equal treatment in the event of any proposal to acquire control of CEL-SCI.
Geert Kersten, Chief Executive Officer, said "We have finally gotten to the Phase III clinical trial stage for a cancer indication that has a multi- billion dollar market with no competing product and we have retained our key marketing rights. That is a fairly unique situation. Therefore we need to be vigilant and protect the shareholders during this crucial time period. Distribution of the Rights is not intended to prevent a takeover of CEL-SCI on terms beneficial to its stockholders; however this action by our Board increases its ability to effectively represent the interests of all Stockholders in the event of an unsolicited takeover attempt." Kersten added that the plan was not adopted in response to any specific effort to gain control of CEL-SCI and that he was not aware of any such attempt.
The Stockholder Rights Plan guards against partial or two-tier tender offers, coercive stock accumulation programs, and other tactics that may be used to gain control of CEL-SCI without offering a fair price to all stockholders. Many other publicity held companies have adopted such plans.
Under the Rights Plan, each stockholder will receive a dividend of one Series A Right and one Series B Right for each share of CEL-SCI common stock registered in the stockholders' name. The Right will not become exercisable until either of two events occurs. First, if any person or group (i) acquires 15% or more of CEL-SCI's common stock, or (ii) begin a tender offer or exchange offer that would result in such person owing 15% or more common stock (except pursuant to an offer for all shares deemed fair by CEL-SCI's Board of Directors), each Series A Right would entitle its holder, beginning on the fifteenth business day after the announcement of the acquisition or the commencement of the tender offer, to buy one share of CEL-SCI's common stock at a price equal to 20% of the public market price of the common stock.
Second, if CEL-SCI is acquired in a merger or other business combination or disposes of more than half its assets after a person or group acquires 15% or more of CEL-SCI's common stock (other than a transaction with a person who acquired Common Shares through a tender offer or exchange offer for all outstanding Common Shares approved by the Board of Directors of the Company in accordance with the terms of Rights Agreement), each Series B right would entitle its holder to purchase shares of the acquiring company's common stock at a 50% discount to market value.
CEL-SCI may redeem the Rights at $0.0001 per Right at any time up to fifteen business days after a public announcement that a 15% position has been acquired or a tender offer has begun.
The distribution of the Series A and Series B Rights will be made on November 9, 2007 to stockholders of record on that date. The Right will expire October 30, 2015. The distribution of the Rights is not taxable to stockholders or CEL-SCI.
CEL-SCI Corporation is developing products that empower immune defenses. Its lead product is Multikine(R). In Phase II clinical trials Multikine was shown to be safe and well-tolerated, and to improve the patients' overall survival by 33% at a median of three and a half years following surgery. The U.S. Food and Drug Administration (FDA) gave the go-ahead for a Phase III clinical trial with Multikine in January 2007 and granted orphan drug status to Multikine in the neoadjuvant therapy of squamous cell carcinoma (cancer) of the head and neck in May 2007.
Multikine, a patented defined mixture of naturally derived cytokines, is the first immunotherapeutic agent in a new class of drugs called "Immune SIMULATORS". Immune SIMULATORS simulate the way our natural immune system acts in defending us against cancer. As opposed to other immunotherapies which are designed to target a single or limited number of specific antigens or molecules, Immune SIMULATORS are multi-targeted; they simultaneously cause a direct and targeted killing of the specific tumor cells and they activate the immune system to produce a stronger anti-tumor attack on multiple fronts.
Multikine is also the first immunotherapeutic agent being developed as a first-line standard of care treatment for cancer. It is administered prior to any other cancer therapy because that is the period when the anti-tumor immune response can still be fully activated. Once the patient has advanced disease, or had surgery or has received radiation and/or chemotherapy, the immune system is severely weakened and is less able to mount an effective anti-tumor immune response. Other immunotherapies are administered after the patient has received chemotherapy and/or radiation therapy, which can limit their effectiveness.
The Company has operations in Vienna, Virginia and Baltimore, Maryland. CEL-SCI's other products, which are currently in pre-clinical stage, have shown protection against a number of diseases in animal tests and are being tested against diseases associated with bio-defense and avian flu.
CONTACT: Gavin de Windt of CEL-SCI Corporation, +1-703-506-9460
Web site: http://www.cel-sci.com/